National Graduate Institute for Policy Studies
Minato-ku, Tokyo 106-8677, JAPAN
NBER Working Papers and Publications
|October 2007||Sustainability, Debt Management, and Public Debt Policy in Japan|
with Takero Doi, Kiyoshi Mitsui
in Fiscal Policy and Management in East Asia, NBER-EASE, Volume 16, Takatoshi Ito and Andrew K. Rose, editors
|July 2006||Sustainability, Debt Management, and Public Debt Policy in Japan|
with Takero Doi, Kiyoshi Mitsui: w12357
The purpose of this paper is to analyze sustainability issues of Japan%u2019s fiscal policy and then to discuss the debt management policy using the theoretical models and numerical studies. We also investigate the desirable coordination of fiscal and monetary authorities toward fiscal reconstruction.
We include a potential possibilities of the government bonds in our theoretical model. The public bonds, therefore, cannot be sold when the issuance leads the amount of debt outstanding to be more than a certain level. In this respect, the fiscal authority has to take into account the upper limit of stocks of public debt.
This possibility of debt default provides the fiscal authority to issue public bonds strategically in an earlier period. A strategic behavior of fiscal authority induces...